Brazil Interest-Rate Futures Yields Fall First Time in Week on Production

Yields on Brazil’s interest-rate futures contracts fell for the first time in a week as a report showing industrial production rose in July at the slowest pace in eight months reinforced the view that the central bank will refrain from raising benchmark borrowing costs tomorrow.

The yield on the contract due in January 2012 fell three basis points, or 0.03 percentage point, to 11.38 percent at 8:45 a.m. New York time. It was the first decline since Aug. 24.

Industrial production rose 8.7 percent last month from a year earlier, compared with 11.1 percent in the previous month, the national statistics agency said in Rio de Janeiro. Brazil’s policy makers will keep benchmark borrowing costs unchanged at 10.75 percent at a two-day meeting starting today, according to the median forecast of 45 economists surveyed by Bloomberg.

The real was little changed at 1.7591 per dollar, from 1.7594 yesterday.

To contact the reporter on this story: Ye Xie in New York at yxie6@bloomberg.net

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